Page 14 - HME Business, April 2018

for your product areas that you want to target, but you are not having to maintain two separate les for each patient. It needs to be able to save you time,” says Daniell Crane, training and support specialist at Universal Software Solutions Inc., which offers DME and pharmacy solutions.
The following are some considerations to help you make the right choice for your business:
Manual Labor
If the pharmacy doesn’t plan to bill Medicare Part B or private insurers, it may make more sense to stick to manual DME manage- ment and a straight retail model. This is both the lowest-cost and often the lowest-bene t option. There’s no investment in new software or extended accreditation, but you have to manage the DME business using your existing tools and you’re limited in what products you can offer.
Which is why most small pharmacies moving into DME opt for Medicare Part B and insurance billing, but that also comes with caveats. Part B billing is more complicated, partly because Part B is more subject to market and political pressures. \[See The Perils of Part B\]
“It depends on how much DME business a pharmacy handles. If you have a large department — particularly if you handle both rentals and sales — you may need a dedicated DME system,” says Lynn R. Edens,
a training technician for HME software company QS/1. “DME software provides a number of advantages. First, it simpli es Medicare Part B billing and compliance. Second, it makes management of your DME more ef cient. It also can expand services to your customers: If you can provide a nebulizer to a patient, it’s likely you can also provide prescrip- tions for inhalation drugs. Likewise with insulin and diabetic supplies.”
Expanding with DME offerings helps you keep the customer shop- ping at your business, and makes it especially important to monitor your client records for which DME products they are likely to need. If you plan to do volume with Medicare and insurance billing, it adds a degree of recordkeeping and compliance dif culty that is probably too complicated to manage manually.
“The patient coming to you for pharmacy now has a need for other products,” Rogers explains. “If you are selling the DME equipment retail is one thing. If you are billing Medicare and commercial payers, you want an up-to-date system that is able to keep up with regula- tory changes.”
Parallel Systems
Some of the reasons running parallel systems is not optimum are obvious: it takes a separate system, which isn’t cheap and involves training, management and duplicate entries of patient records, since the two systems won’t be able to communicate with each other.
“The HME process is so different from the way pharmacies do busi- ness. Medicare Part B billing is more complex with greater compli- ance requirements. For example, dates for prescriptions must be updated from date of service to the pick-up date, documentation is more stringent for auditing purposes and claims submission must be held until the required patient and physician documentation is signed and on le,” Edens says.
The decision would depend on how aggressively you plan to pursue DME and whether that justi es the cost of automating your DME
business or updating to an integrated pharmacy/DMEPOS system. “When you are dealing with the HME piece, the needs are very
similar \[to pharmacies\]. They are going to need to control inventory and have software that takes into account regulatory requirements and billing,” Rogers says.
Billing is one big reason to think hard about adding DME software. Pharmacies are accustomed to adjudicating claims in seconds on
“If you have a large department – particularly if you handle both rentals and sales – you may need a dedicated DME system.”
— Lynn R. Edens, QS/1
The Perils of Part B
Before upgrading software, decide how deep you will wade into DMEPOS.
Like most other ventures, growing a small retail pharmacy by expanding into DME involves a lot of considerations.
On the upside, it can add incremental revenue and offer a natural extension of services you are already providing without necessarily needing a lot of extra space. But to get there the pharmacy owner needs to know his or her market, decide whether to stick to retail DME or move into Medicare Part B and insurance billing, and gure out what invest- ments make the most sense for the business.
Medicare’s recently adopted practice of reverse auctions for suppliers may drive margins too low, or create exclusive territories for a supplier offering the lowest cost on an item. Insurers often follow.
“Medicare is trying now, instead of just cutting reimbursement, they look to who is offering the lowest price,” says Daniell Crane, training and support specialist at Universal Software Solutions Inc. “Can they compete when it comes to bidding wars, and are they targeting actual products that are going to be pro table? It is a very intense balancing act, espe- cially when it comes to Medicare, but also private insurers are getting providers to compete in terms of the lowest price they will take.”
Jason Jacobs, COO of VirtueRN, explains the impact: “About ve years ago there were 40,000 DME providers. Now it’s about 8,000. The competi- tive bid process has really drawn down and consolidated that space.”
DME can add to your sales numbers, but if you don’t plan on doing much volume, it probably isn’t worth adding a DME software system. Either way, it’s essential to be very selective about which items you offer to ensure you can make a pro t.
“Can they compete when it comes to bidding wars, and are they targeting actual products that are going to be pro table?” Crane says. “When I think about the small mom-and-pop, I think of a lot of cash options. They would have to be really cautious about the types of products they choose to dispense. They would have to be really aggressive about running reports to see how pro table \[each\] product is.” That includes staff time for managing the products as well as the tracking system.
Another thing to think about: Part B includes accreditation exemptions for pharmacies that have been open for less than ve years, or if DMEPOS is less than 5 percent of their business over the past three years. A small pharmacy can do a limited amount of DME business with Part B that may be manageable without dedicated DME software. “They have to follow the same rules and procedures, but they don’t need \[DMEPOS\] accredi- tation,” says, Timothy Sa ey, director of DME pharmacy and sleep at accrediting organization ACHC.
“If you are selling the DME equipment retail is one thing. If you are billing Medicare and commercial payers, you want an up-to-date system that is able to keep up with regulatory changes.”
— Steve Rogers, Brightree LLC
Rx 6 April 2018 | DME Pharmacy
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